US Bond House and North America Investment-Grade Corporate Bond House: Morgan Stanley

Verizon’s US$25bn nine-tranche corporate bond was the largest investment-grade deal of the year and Verizon’s biggest since 2013. It generated one of the biggest order books of all time and included the largest ever corporate bond tied to SOFR. The US telecoms company hit the market in March after spending US$45bn on C-band spectrum in the Federal Communications Commission's auction, almost twice as much as the next largest bidder, AT&T, to expand its 5G capabilities. “There have been a lot of large event-type transactions this year but this...

2021 was a year when the US dollar market demonstrated its depth. But few issuers jumped into the Yankee market with the ambition of AerCap, which achieved impressive execution even when interest-rate volatility was heating up and the industry was still struggling with the coronavirus pandemic. The US$21bn nine-part deal from Ireland-based aircraft lessor AerCap was the largest US dollar bond on record from a financial issuer, brought to finance the acquisition of GE Capital’s aviation leasing arm in a deal announced in March. Afterwards, it...

With its deep presence in the US, UK and the Continent, Barclays is one of a handful of banks that can genuinely claim to provide funding options on both sides of the Atlantic. For US issuers, the sterling and euro markets are becoming important avenues to explore. In the euro corporate market, for example, US borrowers accounted for €52bn of issuance in 2021 or just over 17% of overall supply. Only German issuers were more active. Gone are the days when US corporates fund in euros or sterling solely because of the cross-currency basis swap,...

Eli Lilly redefined what is possible at the long end of Europe’s corporate bond market with a near €2.1bn-equivalent four-part deal that included both 30 and 40-year euro notes, allowing it to lock in ultra-low coupons and refinance more expensive US dollar debt. The 40-year bond marked the first euro corporate benchmark issued in that maturity since 2007 and the overall deal was the first ever instance of a corporate bringing 30 and 40-year euro tranches together in the same transaction. The offering also included the issuer’s first...

BNP Paribas bankers like to use metaphors to describe their business. Last year, they were like astronauts, off on a mission. “We all know how challenging the path to space exploration can be. There’s a lot of failure involved but if you want to succeed you need the team to make as few mistakes as possible and strive for perfection,” said Frederic Zorzi, global head of primary markets. It may not have been a perfect year – it never is – but it’s fair to say the team barely put a foot wrong, leading the league tables again for all euro issuance...

With major central banks such as the US Federal Reserve and the European Central Bank still pumping lots of liquidity into their markets, foreign issuers like global banks generally continued raising funds mainly in their mother currencies and opting out of the yen market where investors remain highly selective. But even when market conditions were not favourable for foreign issuers, SMBC Nikko kept the lines of communication open, preparing for their return to yen. And the bank was not afraid to put itself forward as sole arranger, even for...

NTT Finance showed how to maximise ESG bond offerings, while revealing how eager Japanese investors are to support the sector. The finance unit of telecoms giant Nippon Telegraph and Telephone, rated A/AA+/AAA (S&P/R&I/JCR), in October raised ¥300bn (US$2.63bn) from a three-part offering of green bonds, less than a year after selling the biggest domestic yen trade ever – a deal that raised ¥1trn. This was the biggest green bond offering in the domestic market and one of the world's largest single issues of green bonds by a corporate borrower....

While the sterling bond market has sometimes been viewed as a mere arbitrage opportunity to those outside the UK, it undoubtedly plays an important role by providing borrowers with an additional string to their bows. And as funding conditions change with the rowing back of central bank schemes and the prospect of rising interest rates, this will only become more important as the need to investigate all opportunities intensifies. “It was about careful stewardship, careful consideration and leadership,” said Dominic Kerr, HSBC's European head...

Sometimes there are deals that make people really sit up and take notice. The UK Debt Management Office produced one of these in no uncertain terms with its inaugural green Gilt – a transaction that broke records for size, demand and pricing in the asset class and set new standards to which to aspire. September’s issue emerged just a few weeks ahead of November's COP26 climate meeting in Glasgow. Despite its ambitions to be a green leader, the UK market had thus far lagged behind in terms of ESG supply, although the DMO addressed this in one...

Solid with dependable reliability is seen as the hallmark of the Swiss market, but 2021 saw a spate of innovation as it produced two world firsts in rapid succession, plus a domestic first. Zuercher Kantonalbank captured the zeitgeist of 2021 and was instrumental in all three, making for a fabulous year for the bank. Overseas supply has been losing ground in the Swiss franc bond market – from a share of over 55% in 2010–2011, it is now down to a mere 25%. ZKB was a pivotal player in this move, with its strong focus on the domestic segment and a...

SIX Group opened the doors to a digital future in November when it printed the world's first fully digital regulated bonds. With it, the Swiss financial infrastructure giant and owner of Switzerland's stock exchanges made history and took the first step into a digital marketing infrastructure future. The bond was described as a "testament to Swiss innovation and the biggest change in the Swiss bond market in a quarter of a century, since electronic trading started on SIX in 1996", by Manuel Gadient, head of debt capital markets and syndicate...

Mexico’s US$3bn 50-year Formosa bond was a good illustration that the Formosa market is becoming an increasingly important avenue for issuers to diversify their long-term funding. It wasn’t just the size of the deal that stood out but also the timing. The bond, the first by a Latin American sovereign in the Formosa format, came on January 4, the first active session of the year. The deal turned received wisdom on its head. Usually, an issuer such as Mexico would be expected to kickstart its annual funding programme with a transaction in the...